School Bus Operator Seeks Bankruptcy Protection

Published: August 17, 2002

Atlantic Express Transportation Corporation, which transports hundreds of thousands of children to school each day in New York and other cities, filed for Chapter 11 bankruptcy protection yesterday in United States Bankruptcy Court in Manhattan, court filings show.

The privately held company, one of the largest school bus operators in the United States, is based in Staten Island. Atlantic Express and its lawyer did not immediately return calls for comment on how the filing would affect operations, which also include coach buses. The company said it had filed for bankruptcy in 1992 and emerged in 1994.

Its contracts with the New York City school system, which are scheduled to expire in 2005, accounted for more than one-fourth of its revenues in its fiscal 1999, 2000 and 2001 years, the filings show.

''They have assured us they will be able to provide services and fulfill their contract,'' said Kevin Ortiz, a spokesman for the city school system. ''We will carefully monitor the situation, and we do have other contractors who can step in to fill the void if need be.''

Atlantic Express said on Aug. 1 that it failed to make an interest payment on a loan.

''It borrowed too much, and its interest expenses became too onerous,'' said Betsy Snyder, a transportation analyst for Standard & Poor's Ratings Services. ''The company got hit on all sides, both in its operating and its interest costs.''

The company listed $298.7 million in assets and $257 million in liabilities in its filings. Sixty-four affiliated entities also sought court protection.

Atlantic Express said in a Securities and Exchange Commission filing last year that it operated 6,800 vehicles and employed more than 8,500 people, including 6,600 drivers, 700 escorts and 700 mechanics.

The company, which was founded in 1964, had contracts with 149 school districts in New York, California, Connecticut, Illinois, Massachusetts, Missouri, New Jersey, Pennsylvania and Vermont, the filing showed.